Target pressure and corporate scandals: a natural language processing investigation of how organizational culture underlies institutional failures

An organizational culture of pressurizing employees to achieve unrealistic goals (“target pressure”) is often suggested to foster the misconduct and risk-taking that causes institutional failures (corporate scandals, accidents). To conceptualize and investigate this, we gathered anonymous employee online reviews about working in 218 companies (71,830 reviews, containing 4,356,105 words) and developed a natural language processing algorithm to measure the salience of norms for target pressure within the employee reviews. Using this measure, we surfaced and qualitatively analysed sentences in which employees discussed target pressure, and quantitatively tested whether companies with a high target pressure culture (in which target pressure was especially salient in collective thinking) were at greater risk of experiencing a corporate scandal. Our hypothesis was supported. Qualitative analysis found that high target pressure cultures are characterized by norms for three inter-linking elements: overly ambitious targets that are beyond the capability and control of employees, highly consequential targets that generate strain, and expediency in achieving targets, which encourages an “ends justify the means” mentality. Combined, these elements may increase the likelihood of institutional failures by promoting, incentivizing, and normalizing deviant or risky behaviour (i.e. to achieve targets), and implicitly de-prioritizing the importance of safe and ethical conduct.